Class 3

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Chapter 10, 11, 17

• Class 3
• Webster SP1 2011

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• Facilities

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Objectives of Facility Layout

• Minimize material handling costs
• Utilize space efficiently
• Utilize labor efficiently
• Eliminate bottlenecks
• Facilitate communication and interaction between
  workers, between workers and their supervisors,
  or between workers and customers
• Reduce manufacturing cycle time or customer
  service time

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Objectives of Facility Layout

• Eliminate waste or redundant movement
• Facilitate the entry, exit, and placement of
  material, products, or people
• Incorporate safety and security measures
• Promote product and service quality
• Encourage proper maintenance activities
• Provide a visual control of operations or
  activities
• Provide flexibility to adapt to changing
  conditions
• Increase capacity

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Basic Types of Layouts

• Process Layout
• Machines grouped by process they perform
• Product Layout
• Linear arrangement of workstations to produce a
  specific product
• Fixed Position Layout
• Used in projects where the product cannot be moved

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Manufacturing Process Layout
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Manufacturing Process Layout
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Manufacturing Process Layout
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A Product Layout
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Comparison Of Product And Process Layouts

• 1. Description Sequential arrangement Functional
  grouping
• of machines of machines
• 2. Type of Process Continuous, mass
  Intermittent, job shop
• production, mainly batch production,
• assembly mainly fabrication
• 3. Product Standardized Varied,
• made to stock made to order
• 4. Demand Stable Fluctuating
• 5. Volume High Low
• 6. Equipment Special purpose General purpose
• 7. Workers Limited skills Varied skills

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Comparison Of Product And Process Layouts

• 8. Inventory Low in-process, High in-process,
• high finished goods low finished goods
• 9. Storage space Small Large
• 10. Material Fixed path Variable path
• handling (conveyor) (forklift)
• 11. Aisles Narrow Wide
• 12. Scheduling Part of balancing Dynamic
• 13. Layout decision Line balancing Machine
  location
• 14. Goal Equalize work at Minimize material
• each station handling cost
• 15. Advantage Efficiency Flexibility

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Fixed-Position Layouts

• Typical of projects
• Equipment, workers, materials, other resources
  brought to the site
• Highly skilled labor
• Often low fixed
• Typically high variable costs

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Designing Process Layouts

• Minimize material handling costs
• Block Diagramming
• Minimize nonadjacent loads
• Use when quantitative data is available
• Relationship Diagramming
• Based on location preference between areas
• Use when quantitative data is not available

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Block Diagramming

• Create load summary chart
• Calculate composite (two way) movements
• Develop trial layouts minimizing number of
  nonadjacent loads

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Block Diagrams
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Block Diagrams
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Relationship Diagramming(Murthers Grid)

• Used when quantitative data is not available
• Muthers grid displays preferences
• Denote location preferences with weighted lines

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Relationship Diagramming Example
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Relationship Diagramming Example

• A Absolutely necessary
• E Especially important
• I Important
• O Okay
• U Unimportant
• X Undesirable

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Relationship Diagramming Example

• A Absolutely necessary
• E Especially important
• I Important
• O Okay
• U Unimportant
• X Undesirable

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Relationship Diagramming Example

• 1 Absolutely necessary
• 2 Especially important
• 3 Important
• 4 Okay
• 5 Unimportant
• 6 Undesirable

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Relationship Diagramming Example

• 1 Absolutely necessary
• 2 Especially important
• 3 Important
• 4 Okay
• 5 Unimportant
• 6 Undesirable

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Service Layouts

• Usually process layouts due to customers needs
• Minimize flow of customers or paperwork
• Retailing tries to maximize customer exposure to
  products
• Computer programs consider shelf space, demand,
  profitability
• Layouts must be aesthetically pleasing

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Designing Product Layouts

• Product layouts or assembly lines
• Develop precedence diagram of tasks
• Jobs divided into work elements
• Assign work elements to workstations
• Try to balance the amount work of each workstation

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Line Balancing

• Precedence diagram
• Network showing order of tasks and restrictions
  on their performance
• Cycle time
• Maximum time product spends at any one workstation

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Hybrid Layouts

• Cellular layouts
• Group machines into machining cells
• Flexible manufacturing systems
• Automated machining material handling systems
• Mixed-model assembly lines
• Produce variety of models on one line

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Cellular Layouts

1. Identify families of parts with similar flow
   paths
2. Group machines into cells based on part families
3. Arrange cells so material movement is minimized
4. Locate large shared machines at point of use

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Advantages Of Cellular Layouts

• Reduced material handling and transit time
• Reduced setup time
• Reduced work-in-process inventory
• Better use of human resources
• Easier to control - visibility
• Easier to automate

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Disadvantages Of Cellular Layouts

• Inadequate part families
• Poorly balanced cells
• Expanded training and scheduling of workers
• Increased capital investment

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Manufacturing Cell
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Mixed Model Assembly Lines

• Produce multiple models in any order on one
  assembly line
• Harley, Opel
• Issues in mixed model lines
• Line balancing
• U-shaped line
• Flexible workforce
• Model sequencing

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• Facility Location Models

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Types Of Facilities

• Heavy manufacturing
• Auto plants, steel mills, chemical plants
• Light industry
• Small components mfg, assembly
• Warehouse distribution centers
• Retail service

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Factors in Heavy Manufacturing Location

• Construction costs
• Land costs
• Raw material and finished goods shipment modes
• Proximity to raw materials
• Utilities
• Labor availability

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Factors in Light Industry Location

• Construction costs
• Land costs
• Easily accessible geographic region
• Education training capabilities

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Factors in Warehouse Location

• Transportation costs
• Proximity to markets (Customers)

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Warehouse Size Considerations

• Customer service level
• layout
• of products (Stock Keeping Units - SKUs)
• customer base
• size of products
• racks/shelving
• demand variability
• MHE requirements/aisle size
• regulations - CAL OSHA - earthquake safety fire

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Factors in Retail Location

• Proximity to customers
• Ease of customer entry and exit
• Location is everything

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Global Location Factors

• Government stability
• Government regulations
• Political and economic systems
• Economic stability and growth
• Exchange rates
• Culture
• Climate
• Export import regulations, duties and tariffs

• Raw material availability
• Number and proximity of suppliers
• Transportation and distribution system
• Labor cost and education
• Available technology
• Commercial travel
• Technical expertise
• Cross-border trade regulations
• Group trade agreements

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Regional Location Factors

• Labor (availability, education, cost and unions)
• Proximity of customers
• Number of customers
• Construction/leasing costs
• Land costs
• Modes and quality of transportation
• Transportation costs

• Incentive packages
• Governmental regulations
• Environmental regulations
• Raw material availability
• Commercial travel
• Climate
• Infrastructure
• Quality of life

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Regional Location Factors

• Community government
• Local business regulations
• Government services
• Business climate
• Community services
• Taxes

• Availability of sites
• Financial Services
• Community inducements
• Proximity of suppliers
• Education system

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Site Location Factors

• Customer base
• Construction/ leasing cost
• Land cost
• Site size
• Transportation
• Utilities

• Zoning restrictions
• Traffic
• Safety/security
• Competition
• Area business climate
• Income level

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Location Incentives

• Tax credits Wal-Mart in Wyandotte
• Relaxed government regulation
• Job training
• Infrastructure improvement
• Money

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Center-of-Gravity Technique

• Locate facility at center of geographic area
• Based on weight and distance traveled
• Establish grid-map of area
• Identify coordinates and weights shipped for
  each location

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Project Managementand Operations
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• Project Management

First Essay on Project Management 1697 An
Essay Upon Projects 1959 HBR Article The
Project Manager Air Force Manual 1964
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Project Management
In todays global marketplace, complexity and
speed are certainties. In such an environment, a
good axiom for project management is, Do It, Do
It Right, Do It Right Now. Creating clear
direction, efficiency, timely response, and
quality outcomes requires project managers who
are agile -- adept at change. The associated
disciplinary areas are clearly spelled out in the
following PMI definition.Project management is
the application of knowledge, skills, tools, and
techniques to a broad range of activities in
order to meet the requirements of a particular
project. Project management is comprised of five
Project Management Process Groups Initiating
Processes, Planning Processes, Executing
Processes, Monitoring and Controlling Processes,
and Closing Processes.
Source Project Management Institute -
http//www.pmi.org/info/PP_AboutProfessionOverview
.asp?nav0501
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Elements of Project Management

• Project team
• Individuals from different departments within
  company
• Matrix organization
• Team structure with members from different
  functional areas depending on skills needed
• Project manager - Leader of project team
• Project Charter high level description of what
  is to be accomplished in a project and delegates
  authority to project manager to implement actions
  to complete project

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Project Planning

• Statement of work
• Written description of goals, work time frame
  of project
• Activities require labor, resources time
• Precedence relationship shows sequential
  relationship of project activities

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Elements of Project Planning

• Define project objective(s)
• Identify activities
• Establish precedence relationships
• Make time estimates
• Determine project completion time
• Compare project schedule objectives
• Determine resource requirements to meet objective

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Work Breakdown Structure

• Hierarchical organization of work to be done on a
  project
• Project broken down into modules
• Modules subdivided into subcomponents,
  activities, and tasks
• Identifies individual tasks, workloads, and
  resource requirements

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Project Control

• All activities identified and included
• Completed in proper sequence
• Resource needs identified
• Schedule adjusted
• Maintain schedule and budget
• Complete on time

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A Gantt Chart
Around since 1914

• Popular tool for project scheduling
• Graph with bar for representing the time for each
  task
• Provides visual display of project schedule
• Also shows slack for activities
• Amount of time activity can be delayed without
  delaying project

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Gantt Charts

• Gantt described two principles for his charts
• measure activities by the amount of time needed
  to complete them
• the space on the chart can be used the represent
  the amount of the activity that should have been
  done in that time.

Gantt charts were employed on major
infrastructure projects including the Hoover Dam
and Interstate highway system and still are an
important tool in project management.
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A Gantt Chart
Figure 6.2
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Example of Gantt Chart Problem
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CPM/PERT

• Critical Path Method (CPM)
• DuPont Remington-Rand (1956)
• Deterministic task times
• Project Eval. Review Technique (PERT)
• US Navy, Lockheed
• Multiple task time estimates

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PERT/CPM
Program Evaluation and Review Technique (PERT)
developed in conjunction with the development of
the Polaris missile program for submarines
developed by the US Navy with Lockheed as the
lead contractor Critical Path Method (CPM)
developed through a joint venture between the
DuPont Corporation and the Remington Rand
Corporation the original purpose was to monitor
and evaluate plant maintenance management
projects.
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Project Network for a House
Figure 6.4
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Critical Path

• A path is a sequence of connected activities
  running from start to end node in network
• The critical path is the path with the longest
  duration in the network
• Project cannot be completed in less than the
  time of the critical path

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The Critical Path

• A 1-2-3-4-6-73 2 0 3 1 9 months
• B 1-2-3-4-5-6-73 2 0 1 1 1 8 months
• C 1-2-4-6-73 1 3 1 8 months
• D 1-2-4-5-6-73 1 1 1 1 7 months

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The Critical Path
Activity Start Times
Figure 6.6
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Early Times

• ES - earliest time activity can start
• Forward pass starts at beginning of CPM/PERT
  network to determine ES times
• EF ES activity time
• ESij maximum (EFi)
• EFij ESij - tij
• ES12 0
• EF12 ES12 - t12 0 3 3 months

Why is this important?
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Late Times
Who Cares? Why is this Important?

• LS - latest time activity can start not delay
  project
• Backward pass starts at end of CPM/PERT network
  to determine LS times
• LF LS activity time
• LSij LFij - tij
• LFij minimum (LSj)

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Activity Slack Data
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Activity Slack Data
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Project Crashing

• Crashing is reducing project time by expending
  additional resources
• Crash time is an amount of time an activity is
  reduced
• Crash cost is the cost of reducing the activity
  time
• Goal is to reduce project duration at minimum cost

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Time-Cost Relationship

• Crashing costs increase as project duration
  decreases
• Indirect costs increase as project duration
  increases
• Reduce project length as long as crashing costs
  are less than indirect costs

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Life Cycle Management

• Long term view of projects to guide decision
  making solutions that provide life time success
  vice short term
• Acquisition development production
  introduction sustainment disposal
• Links system costs to big picture better use of
  resources minimize total cost of ownership

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Whats Next

• Mid Term due in one week
• Chap 9, Chap 12 (Capacity and Aggregate Planning,
  Inventory Management) in two weeks